College planning costs: Who's picking up the tab?
By Brett Anderson
St. Croix Advisors
If you have kids, chances are this question has been mulled over continuously throughout their lifetimes.
At this point, (and unless a whole lot changes occur between now and when your kids graduate from high school, it will still be true), college is expensive! The prospect of a "full ride" is becoming quite rare, and expecting kids to work their way through is increasingly unrealistic. So, what are your options, then?
- Save!The sooner you start saving, the better. There are a variety of options and vehicles for college saving, depending on your situation. Number of years before college, amount to invest, cost of college, etc. will all play a factor in what’s available for your family. Just plan on planning (before it’s too late).
- Scholarships, grants and other financial aid – Depending on your financial situation, your student’s performance and extracurricular involvement and a variety of other factors, your student could qualify for available monies. Encourage your student to work with both their high school counselors as well as the financial aid office at their potential colleges to find and apply for any available monies that they qualify for. And if you have a top performer, don’t hesitate to help him/her use that to their advantage in negotiating the best deal between their colleges of choice.
- Borrow – After exhausting the above resources, you have two remaining options: pay cash as you go or borrow. Borrowing does not have to be as devastating as major media outlets currently portray it to be, in that you have to be a smart borrower. If you’ve exhausted your options for federal (subsidized) loan dollars, it often pays to shop the local lender market. Often, local banks will have great student loan rates available to students in their particular state. Simply stated, it pays to shop around.